MorphoSys AG Reports Financial Results for Fiscal Year 2005
Martinsried/Munich, February 24, 2006
MorphoSys AG (Frankfurt Stock Exchange: MOR; Prime Standard Segment; TecDAX) today announced its financial results according to International Financial Reporting Standards (IFRS) for the three-months’ period and fiscal year ending December 31, 2005.
Highlights of the Year 2005:
• First HuCAL®-derived antibody from partnership with GPC Biotech AG enters clinical trials in January 2005; In January 2006, Roche filed all necessary applications to commence a European Phase 1 clinical trial with a HuCAL®-derived antibody to treat Alzheimer’s disease
• Consolidation of Research Antibody segment through acquisition of the Biogenesis Group in January 2005 and Serotec Group in January 2006; MorphoSys thereby established itself amongst the leading suppliers of research antibodies and antibody research technologies
• Conclusion of three new multi-year partnerships with U.S. pharmaceutical companies Merck & Co., Inc., and Lilly & Company as well as Japanese pharmaceutical group, Shionogi
• Extension and substantial enlargement of existing collaborations including Bayer, Boehringer Ingelheim, ImmunoGen and Bristol-Myers Squibb
• Successful private placement of 490,133 shares raising gross proceeds of approx. EUR 17.4 million.
• In January 2006, MorphoSys established an American Depository Receipt (ADR) Program Level 1 in order to support broadening the Company’s U.S. investor base
• Appointment of Dr. Marlies Sproll as Chief Scientific Officer and Member of the Management Board
Financial Review for the fiscal year 2005 (IFRS):
Under International Financial Reporting Standards (IFRS), revenues for the year 2005 amounted to EUR 33.5 million (2004: EUR 22.0 million), an increase of 52% over the prior year. Revenues arising from the Therapeutic Antibodies segment accounted for 87% or EUR 29.1 million of total revenues. The Research Antibodies segment, comprising MorphoSys’s Antibodies by Design unit and the Biogenesis Group, generated 13% or EUR 4.3 million of total revenues. MorphoSys’s revenue growth was driven primarily by the conclusion of new deals and higher levels of success-based payments in the therapeutic segment, and increasing growth in the research segment arising both organically and from acquisitions.
Total operating expenses including stock-based compensation for the full year 2005 were EUR 27.3 million (2004: EUR 21.3 million), representing an increase of 28% over the prior year. Cost of goods sold (COGS), arising solely from the Research Antibodies segment, amounted to EUR 2.5 million (2004: EUR 0.9 million), and largely reflected the inclusion of Biogenesis in Group accounts. Research and development expenses rose by EUR 2.1 million to EUR 13.6 million in 2005 (2004: EUR 11.5 million). The increase in R&D expenses mainly resulted from higher intangibles costs, including success-based license fees to third party licensors, settlement of the Lilly patent dispute, and amortization/write-downs of acquired intangible assets. Sales, general and administrative expenses increased by EUR 2.6 million to EUR 10.1 million (2004: EUR 7.5 million). This effect mainly resulted from higher company-wide marketing costs, and higher personnel and integration costs associated with Biogenesis. Non-cash charges related to stock-based compensation amounted to EUR 1.1 million (2004: EUR 1.4 million). Non-operating expenses in 2005 amounted to EUR 1.5 million (2004: Non-operating expenses of EUR 0.4 million). Non-operating expenses include income taxes payable, losses on foreign exchange and interest expenses.
For the full year 2005 MorphoSys posted a net profit of EUR 4.7 million compared to a net profit of EUR 0.3 million in the same period of the previous year. The resulting diluted earnings per share for the year 2005 amounted to EUR 0.83 (2004: earnings per share of EUR 0.05).
On December 31, 2005, the Company had EUR 53.6 million in cash, cash equivalents, and marketable securities, compared to the EUR 37.2 million balance at December 31, 2004. The increased cash position, measured prior to the acquisition of Serotec in January 2006, mainly derived from higher cash inflows as a result of the expanded operational activity and from a capital increase successfully executed in March 2005. The number of outstanding shares at December 31, 2005 was 5,996,701 shares, compared to 5,408,790 at December 31, 2004.
Fourth Quarter of 2005 (IFRS):
In the fourth quarter of 2005, the Company generated revenues of EUR 9.7 million, compared to EUR 6.2 million in the same quarter of 2004, an increase of 56 %. Total operating expenses amounted to EUR 7.3 million, compared to EUR 6.8 million in the same quarter of 2004. The resulting net profit for the fourth quarter 2005 was EUR 0.8 million, compared to a net loss of EUR 0.7 million in the fourth quarter of 2004.
Financial Guidance for 2006
MorphoSys is projecting profitability on revenues of approx. EUR 50 million. More detailed financial guidance will be provided during today’s press conference.
“In 2005 MorphoSys enjoyed considerable growth and significantly strengthened its two core business segments: the development of therapeutic antibodies and the marketing of antibodies as high-quality research tools,” stated Dr. Simon Moroney, Chief Executive Officer of MorphoSys AG.
“Today’s numbers demonstrate that the Company’s business continues to grow strongly, thereby affording MorphoSys the flexibility to invest in projects which help secure the long term growth of the Company,” commented Dave Lemus, Chief Financial Officer of MorphoSys AG.
MorphoSys develops and applies innovative technologies for the production of synthetic antibodies which accelerate drug discovery and target characterization. Founded in 1992, the Company’s proprietary Human Combinatorial Antibody Library (HuCAL„µ) technology is used by researchers worldwide for human antibody generation. The Company currently has licensing agreements and/or research collaborations with Bayer (USA), Boehringer Ingelheim (Germany), Bristol-Myers Squibb (USA), Centocor Inc. (USA), GPC Biotech AG (Germany), Hoffmann-La Roche AG (Switzerland), ImmunoGen Inc. (USA), Merck & Co., Inc. (USA), Novartis AG (Switzerland), Novoplant GmbH (Germany), Pfizer Inc. (USA), ProChon Biotech Ltd. (Israel), Schering AG (Germany), Shionogi & Co., Ltd. (Japan), Xoma Ltd. (USA) and others. Additionally, MorphoSys is active in the antibody research market through its Antibodies by Design business unit. Antibodies by Design was founded in 2003 for the purpose of exploiting the MorphoSys non-therapeutic antibody markets. MorphoSys’ activities in the research antibody segment were significantly strengthened through the acquisition of the U.K. and U.S.-based Biogenesis Group in January 2005 and the Serotec Group in 2006. For further information please visit the corporate website at: http://www.morphosys.com/.
Statements included in this press release which are not historical in nature are intended to be, and are hereby identified as, ¡§forward-looking statements¡¨ for purposes of the safe harbour provided by Section 21E of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words including ¡§anticipates¡¨, ¡§believes¡¨, ¡§intends¡¨, ¡§estimates¡¨, ¡§expects¡¨ and similar expressions. The company cautions readers that forward-looking statements, including without limitation those relating to the company¡?s future operations and business prospects, are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements. Factors that may affect future operations and business prospects include, but are not limited to, clinical and scientific results and developments concerning corporate collaborations and the company’s proprietary rights and other factors described in the prospectus relating to the company’s recent public offering.
- Contact Information
- Dr. Claudia Gutjahr-Löser
- Director Corporate Communications
- MorphoSys AG
- Contact via E-mail
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